Tech Mahindra will roll out salary hikes in a phased manner in 2021 starting with its junior-most employees.
CP Gurnani, CEO, Tech Mahindra, said in an earnings call on October 23, “We are looking at early 2021 for appraisal and salary hikes. But the management team has not really sat down to decide the quantum of hikes.”
“But it is very clear that it will be rolled out and it will be staggered,” he said.
The way it is going to work out, Gurnani explained, is that the junior-most employees will get the salary hike the fastest and the senior-most employees will get it later. “But it is part of my budget and part of my planning to do salary hikes for junior-most employees in FY21 (before March 2021) and for the rest in calendar year 2021 (before December 2021)," he added.
This is in line with what its larger peers have done. All of its peers -- TCS, Wipro, Infosys and HCL Tech -- have announced salary hike for employees, some rolling them out effective October 1 and others effective January 2021.
IT firms had suspended salary hikes and hiring for employees on the back of the pandemic. With demand recovery, most of the firms have reinstated the hikes and resumed hiring.
For Q2, Tech Mahindra registered $1265.4 million in revenues, up 4.8 percent quarter-on-quarter and down 1.7 percent year-on-year.
Total headcount in the top four IT firms increased by 17,000 for the quarter ended of September 2020 after a decline of 9,000 in Q1. Tech Mahindra headcount too dropped by 2,000 in the June 2020 quarter. It has increased by 842 in Q2.
The total headcount stood at 124,258 at the end of September 2020.
Manoj Bhat, CFO, Tech Mahindra, said in the earnings call that this is reflective of the increase in demand as clients are investing in digital transformation. The company reported net new deal wins of $421 million in Q2, compared to $290 in Q1. A majority of them were in the areas of digital.
When it comes to work from home, the company is looking at 25-30 percent of its employees work from home on a permanent basis.
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